Constructing Change: Accelerating Energy Efficiency in India's Buildings Market

November 21, 2014

India is at a crossroads in its development path. India's building-occupied area is projected to skyrocket from 8 billion square meters in 2005 to 41 billion in 2030. To keep pace, India's energy production must grow 6.5 percent per year from 2011 to 2017. Buildings already account for more than 30 percent of the country's electricity consumption, and nearly 70 percent of the buildings in India that will exist by 2030 have yet to be built. Under a business-as-usual scenario, India's current power production is and will be unable to meet the expected demand. Energy efficiency will be the cheapest, fastest way to close the energy demand and supply gap. Incorporating energy-efficient windows, lighting, and air-conditioning systems at the design stage for new construction is more economical than costly retrofits. If developers across India implement standard energy efficiency measures in new construction and major retrofits, the country could avoid the need for 2,988 megawatts (MW) of generation capacity and save $42 billion annually.

State and local governments, real estate developers, and financial institutions are critical to the successful development and implementation of energy-efficient buildings. While existing government policies, building-rating systems, and active stakeholders do provide a foundation for accelerating progress in energy efficiency, as India's real estate market continues to grow, the current policy framework needs to be further developed and implemented by coordinated stakeholder action. It is therefore critical that these three leading stakeholder groups -- state and local governments, real estate developers, and financial institutions -- drive development and adoption of energy efficiency measures in the buildings market for new construction and major retrofits.

Accelerating energy efficiency while India experiences an unprecedented growth in its buildings market provides a singular opportunity to generate tremendous financial benefits, while improving public health, combating climate change, and closing the widening gap between India's energy production and demand.